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Finance & Accounting
Pages 4 (1004 words)
Name: Course: Date: Ethical problem Introduction Businesses exist so they can produce goods and services that are needed by the consumers, while making value to the shareholders. Therefore, the relationship between the shareholders and the management of the company is based on the assumption that the managers will act in the best interest of the shareholders, by doing all that appertains to creating value for the shareholders (Frederic, 12)…
Therefore, this discussion seeks to analyze the causes of an ethical conflict between a manager and shareholders that entails the manager hiding some information to the shareholders, with a view to categorize the nature of the conflict, its causes and how it can be avoided. Define the conflict The action of the managers to hide some information to the shareholders is unethical. This is because, ethical behavior requires that any decision reached by the management should be a truthful one, and thus any action that is mean to hide the truth from the shareholders is unethical (Frederic, 17). This type of conflict falls under the category of conflict referred to as Normative ethics, in a subset referred to as professional ethics, which requires that the professional conduct of individuals within an certain professions should act in accordance with set standards of right and wrong, and the deviation from such conduct eventually creates an ethical conflict (Weiss, 41). ...
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